Hal Finney and Bitcoin’s Earliest Days

When Satoshi Nakamoto released bitcoin in January 2009, few people took notice, and of those people, even fewer grasped its significance. One that did was Hal Finney.

Mr. Finney, then 53, was an engineer and developer working at a tech company called PGP Corp. in Silicon Valley, which focused on encryption systems. He designed things like an anonymous remailer, an email system that used cryptography techniques to encrypt messages. Mr. Finney was also a member of the cypherpunks, a community of libertarian and even anarchist-leaning techies that formed in the 1990s and were focused on utilizing cryptography to thwart encroaching attacking on personal privacy.

In the spring of 2014, Mr. Finney answered questions from the Wall Street Journal, at a time when he was still able to communicate via email. Even then, it took great time and effort for him to write out his answers, using specially designed software. Over the ensuing months, he lost even that capability.

Reflecting on his time working with Nakamoto, Mr. Finney said they never spoke directly, and said he does not know Nakamoto’s true identity, although at the time he assumed he was talking to a young Japanese-American male. The two communicated via email (Nakamoto’s email was, naturally, encrypted), and Mr. Finney saved those emails, some of which he shared with the Journal. You can read them here. They open a small window into the first days of the digital currency, and provide a slight bit of light on Nakamoto himself.

The cypherpunks had been focused on digital, anonymous money for years and had build several early systems, all to no avail. Mr. Finney himself had developed a version of e-money in 2004. So when bitcoin first came around in October 2008, most members were dubious. Mr. Finney was an outlier.

Mr. Finney replied to Nakamoto’s Jan. 9, 2009, announcement that he had launched bitcoin, and for the next two weeks he worked with the founder to debug the system and get it running properly. Mr. Finney became a key contributor, the first person to work with Nakamoto, to run the bitcoin software, and the first to receive a transfer of bitcoin.

The conversations between the men are wholly dedicated to setting up the bitcoin network, and are very technical in nature. In that sense, they don’t shed a tremendous amount of light on Nakamoto. But they do give some measure of the man, and they do open a window into bitcoin’s earliest days.

Mr. Finney downloaded version 0.1.0 – and it crashed, which surprised Nakamoto who’d been testing the system himself and hadn’t had any crashes. But he managed to reproduce the bug, and the faulty code that caused it. “It was absolutely the last piece of code to go in,” he wrote. “I’m really dismayed to have this botch up the release after all that stress testing.” It’s one of the few displays of emotion from him in the emails.

They went back forth, through version 0.1.2, and 0.1.3. There were more crashes, more debugging, more rewriting and retooling of the code over and over again.

“It was getting so there were so many zombie nodes, I was having a hard time getting a reply to any of my messages,” Nakamoto wrote to Mr. Finney in one email, while he was simply trying to establish reliable connections between two different users of the system, the other being Mr. Finney.

Mr. Finney from time to time was himself pegged as Satoshi Nakamoto, a claim he denied. He also said he didn’t know Nakamoto’s true identity. He never asked Nakamoto to identify himself. Mr. Finney told the Journal in the spring that he does believe it is possible to discover Nakamoto’s real identity, albeit he didn’t have any thoughts himself about who he may be. Mr. Finney also said that he was surprised by bitcoin’s rapid growth, but that he thought it could eventually live up to the hype.